$$$: Time to move to cash?

First, the disclaimers:

1) I don’t give investment advice.

2) I think Jim Cramer is a blowhard.

But …


Last week, a friend of mine who seems to have a touch reading the market alerted me that he was moving strongly towards cash … away from stocks … and far away from bonds.


Cramer must have been listening in.

Here are Cramer’s 7 reasons to move to cash …

According to Yahoo Finance, Cramer says:

1. Geo-political events involving the Middle East are unfolding by the minute. “We have no idea what’s going to happen in  Syria ,” Cramer explained.

2. “We have no idea who the Fed chief is going to be either,” Cramer added. And if there’s anything that Wall Street hates it’s uncertainty. “Most of the people I talk to who are professional investors want  Janet Yellen . But it seems like the President may go with Larry Summers.”

3. Talk of a government shutdown will likely dominate the national conversation as lawmakers again grapple with  debt limits . “Nobody, but nobody cares about the stock market in Washington.”

4. Concerns about  housing are growing incrementally worse. “Not only are homes not as affordable as they were but if mortgage rates go above five percent I believe home sales will get hammered,” Cramer said.

5.  Retail is too much of a wildcard. “We have no idea how back-to-school’s really going. Somehow I don’t think we are going to hear good things,” Cramer said.

6.  Employment  is improving. “I expect we could get a terrific employment number Friday,” Cramer said. That may seem bullish, but Cramer believes a strong jobs number will again generate chatter of Fed tapering. In turn, that should send stocks lower.

7. It’s September. “Historically,  September is a rough month ,” Cramer said. “I lost a ton of money trading at my hedge fund in September. My charitable trust has rarely done well in September. It’s just a crummy month and I don’t like the odds.”

All told, Cramer believes these catalysts will conspire to send stocks lower. And Cramer wants you to be prepared.

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5 Responses to “$$$: Time to move to cash?”

  1. Alexander S Says:

    Those seem plausible factors that could drive increased market risk. So, Ken, are you raising your cash allocation, too?

  2. DavidM Says:

    That sounds like what the Russians did. Before the bubble burst, they put all their cash into Cyprus banks — which then went bust, and the government confiscated all the deposits!

  3. Alex S Says:

    With a more detailed, global perspective, here is a summary Deutsche Bank’s purported analysis – dubbed “The 7 “Risk” Horsemen Of The Sept-ocalypse:” http://www.zerohedge.com/news/2013-09-04/mapping-7-risk-horsemen-sept-ocalypse
    Perhaps this inspired Cramer….

  4. Andrew L. Says:

    Hey, since we are totally speculating here: Take the 7 horse in the 6th race at Churchill Downs.

    Or maybe we can play coin flip later.

  5. Andrew L. Says:

    September Nums:
    DJIA: +2.58%
    S&P5C: +3.79%
    NASDAQ: + 6.34%

    You might best exchange the 7 horsemen for Jim, Jack, Johnnie, and Jose.

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